Inflation co-movement in emerging and developing Asia: the monsoon effect.

Co-movement (synchronicity) in food-inflation rates among emerging and developing countries in Asia is partly due to common rainfall shocks – a result which the paper terms the 'monsoon effect'. Economies with higher trade integration and co-movement in nominal effective exchange rates also experience greater food-inflation co-movement. In the context of the growing literature on the globalization of inflation, these results suggest that common weather patterns are partly responsible for any role played by a so-called 'global factor' among inflation rates in emerging and developing economies, in Asia at least. [ABSTRACT FROM AUTHOR]